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Calves paid by the pound
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<blockquote data-quote="3MileRanch" data-source="post: 1015795" data-attributes="member: 20578"><p>That kind of deal is available all over at different rates of return. If you get them young and you just need to watch them grow for a season then I would say 50 cents a lb isnt a bad deal. Usually the people I see doing this are those that own their own land though. I see it managed two ways. One is the owner of the calves assumes all the risk for the cattle and the owner of the land assumes all the risk and expense for the land, ie fertilizer, fences, seeding, etc., the other is the owner of the land assumes all the risk for both. The more risk you assume the higher your payout should be. Either way, the weight is by the potload so death is factored in. If the animal dies you dont get paid for it. The weight came in, but it didnt go out. Its a good deal for the owner either way. If your looking to make money I would be the owner, make your money when you buy, send them to a feedlot for 900 days and sell. Even if you only make $50 - $100 a head you are making money. Lots of times the feedlots will do everything from loaning you the money to buy the cows to selling them for you. Feedlots are really in the feed business and need to keep their lots full too get paid. If they have to loan you the money to buy the cows to do it then many of them will. Otherwise they will have to buy all the cows themselves and assume all of the risk as well.</p></blockquote><p></p>
[QUOTE="3MileRanch, post: 1015795, member: 20578"] That kind of deal is available all over at different rates of return. If you get them young and you just need to watch them grow for a season then I would say 50 cents a lb isnt a bad deal. Usually the people I see doing this are those that own their own land though. I see it managed two ways. One is the owner of the calves assumes all the risk for the cattle and the owner of the land assumes all the risk and expense for the land, ie fertilizer, fences, seeding, etc., the other is the owner of the land assumes all the risk for both. The more risk you assume the higher your payout should be. Either way, the weight is by the potload so death is factored in. If the animal dies you dont get paid for it. The weight came in, but it didnt go out. Its a good deal for the owner either way. If your looking to make money I would be the owner, make your money when you buy, send them to a feedlot for 900 days and sell. Even if you only make $50 - $100 a head you are making money. Lots of times the feedlots will do everything from loaning you the money to buy the cows to selling them for you. Feedlots are really in the feed business and need to keep their lots full too get paid. If they have to loan you the money to buy the cows to do it then many of them will. Otherwise they will have to buy all the cows themselves and assume all of the risk as well. [/QUOTE]
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